Over 90% Of Informal Workers Lack Means To Pay Taxes

Taiwo Oyedele.

The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, has stated that over 90 percent of individuals operating within Nigeria’s informal sector do not possess the financial means to pay taxes.

He made this statement on Friday during a roundtable discussion with journalists, analysts, and social media influencers regarding the country’s newly introduced tax laws.

Oyedele dismissed the popular notion that Nigeria’s revenue shortfall could be resolved by focusing on the informal sector.

“This is the reason why Nigeria has ended up introducing multiple taxes, because we are trying to chase people in the informal sector every now and then,” he explained.

“When in fact, more than 90 percent of operators in that sector are just there for survival. They are just trying to find how to put food on the table from one day to another. They have no capacity to pay taxes.

“If somebody is roasting corn by the roadside, if they have customers from when they resume in the morning till they close at night, they are still a poor person. If somebody is a vulcaniser, and they have customers all around for the day, they are still poor.

“If somebody is pushing wheelbarrows to carry goods for people, and they have customers all the time around the day, they are still poor. They have no capacity to pay taxes and should not be taxed.”

He emphasised that this was the reason President Bola Tinubu had maintained that both poverty and capital should not be taxed. “We should not tax seeds but wait for the fruits,” he added.

Regarding tax reforms, Oyedele pointed out that Nigeria’s newly enacted laws had improved transparency, bolstered accountability, and closed several loopholes.

He observed that although the Federal Inland Revenue Service (FIRS) collected over ₦20 trillion in taxes last year and is expected to surpass that figure in 2025, the new reforms have introduced more stringent measures to prevent misconduct and ensure compliance.

“These new tax laws have put in place more structures, more provisions, and more requirements to hold them to account, to make sure that they do their work with responsibility, that they are more diligent,” he said.

“There are even instances in the new tax law where there are personal liabilities for an officer not doing what they are supposed to do. So we have strengthened the governance, also accountability, their report that they must present now, and make public, which they were not doing before.

“Whatever it is that the FRS is doing today, under the new tax law, it will be a better agency from all angles.”

Oyedele also revealed that the reforms now require all tax revenues to be paid directly into the federation account, thereby closing previous avenues of revenue leakage.

On the matter of corruption, he noted that various stakeholders—including taxpayers, government officials, and consultants—had previously contributed to malpractice, but that the new laws had introduced mechanisms to address these issues.

“These new tax laws have now made provisions to address all the parties,” he explained.

“As a taxpayer, trying to evade your taxes now is more expensive under the new tax law. As a consultant, you are being monitored for what you do.

“In fact, there is a requirement for registration of a tax agent, and we monitor what they do on the system, and then for the tax officer, that is even the one who is more risky now. So overall, we think this is taking us in the right direction.”